But one of the thorniest issues facing IBM as it hones its NC products is the specter of anemic network performance, a perennial headache for NC vendors.

These basic computers, which have no hard drive, are intended to work by downloading programs and data from the server. However, information system managers are concerned about network and application performance being slowed to a crawl by hundreds, or thousands, of users accessing the network at the same time.

To resolve this, IBM says it is working on ways of automatically taking more of the processing load off the network and putting it on more powerful NCs. In cases where a high-performance NC such as IBM's Network Station 1000 is used, the NC could do data processing, thus reducing dependency on the server and freeing up network bandwidth. Such technology could be available by the end of 1998 or early 1999, said Howie Hunger, director of channels and marketing for IBM's Network
Computing Division.

However, for less powerful NCs, such as the Network Station 100, applications would still run mostly on the server, IBM said.

Other efforts to improve NC performance include adding the ability to start up
computer by having a server continuously transmit a signal to turn on and load up the operating system and needed applications (a technique called "multicast boot"), rather than having the client computer ask the server for the information. This would alleviate bottlenecks which occur when many NCs are started up simultaneously and network performance degrades.

Such technology could go a long way in addressing concerns about network
and application performance for companies interested in NCs--and there are
early indications that companies are even beginning to consider NCs as a
viable alternative for desktop PCs in limited circumstances.

IBM claims that some companies are even now planning to replace older PCs
with NCs. General Accident Fire & Life Corporation of London recently said
it would purchase 4,000 NCs from IBM. While initial deployments of Network
Station 300 systems will be replacing traditional "green screen" or "dumb"
terminals--devices that depend entirely on a central server to process information--the company will also deploy Network Station 1,000 systems to replace some PCs.

A group of NC proponents are meeting this week to discuss a set of
standards that could lead to wider acceptance for the devices. Microsoft is also taking part in the meeting, which will focus on allowing all kinds of servers to manage and "boot up" any NCs that may be connected, including Windows terminal devices.

While IBM aims at improving network performance, other issues lie in wait.

"The No. 1 inhibitor to adoption of NCs, if we're talking about the reference platform, is the lack of access to Windows-based applications," said Clay Rider, chief analyst with Zona Research.

As if on cue, IBM today announced that it is licensing technology from Citrix which gives Network Station users
access to Windows applications when used with Citrix's WinFrame server software. The official NC specification does not take Windows into account but is supposed to rely on the Java programming language.

Another key problem for NCs is that the cost of the standard Intel architecture keeps going down. The main advantage NC devices can claim, Ryder says, is that they will offer a lower total cost of ownership. However, Microsoft can easily absorb ideas from the NC camp and move those into corporate computing, thereby
undercutting the whole NC effort, Ryder says.